The stock price of Trump Media & Technology Group (TMTG), the parent company of Truth Social, the social networking service owned by former President Donald Trump, fell below the $17 mark for the first time since its listing in March, hitting an all-time low. With the stock price plummeting nearly 80% from its peak, investor sentiment has become even more frigid.

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This sharp decline is analyzed to be due to Vice President Kamala Harris narrowly leading in the U.S. presidential election polls, increasing the possibility of former President Trump losing the election. Amid consecutive drops in stock price, concerns are rising that when the lock-up period for TMTG shares ends on the 19th of this month, initial investors including former President Trump may rush to sell their shares. Unless former President Trump's approval rating rises dramatically, a rebound in the stock price is unlikely for the time being.

TMTG Stock Price Trend

· March 26 TMTG Nasdaq Initial Listing Day 55.99
· July 15 Right After Trump Shooting Incident 40.58
· July 22 Biden Candidate Withdrawal 30.70
· September 4 16.98

According to the New York Times (NYT), on the 5th (local time), TMTG's stock price was trading at $17.40, up 2.47% from the previous session. The previous day, it closed at $16.98, falling below the $17 mark for the first time since its listing on March 26, before rebounding slightly. Nevertheless, it remains 78.08% lower than its all-time high of $79.38 after listing.

The main reason for this steep decline is that former President Trump's approval rating has not been able to surpass that of Vice President Harris. According to a poll conducted by SSRS for CNN from June 23 to 29, Harris is leading in two of six swing states, Trump is ahead in one, and the remaining three are in a dead heat. Harris leads in Wisconsin (50%) and Michigan (48%), while Trump leads in Arizona (49%). Georgia, Nevada, and Pennsylvania remain too close to call.

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As a result, concerns are growing that former President Trump could lose the presidential election, significantly weakening investor sentiment toward TMTG. CNBC reported, "TMTG stock trades more like a 'meme stock' that moves based on online buzz rather than traditional investment fundamentals," adding, "The stock price inevitably rises and falls depending on former President Trump's political fate."

[Image source=Reuters Yonhap News]

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The biggest event considered a variable for TMTG's stock price, along with former President Trump's approval rating, is the upcoming lock-up expiration on the 19th of this month. If the lock-up is lifted for former President Trump, who owns 59% of TMTG shares, his close associates, and initial investors, and they move to sell in large quantities, a sharp decline is expected.

Although former President Trump has not yet commented on whether he will sell his shares, considering his current financial difficulties, there is a high possibility that he may sell at least a portion of his holdings. This is because the Trump campaign is facing a deepening cash shortage, not only due to election expenses but also mounting legal costs.

According to Forbes, as of the end of July this year, the cash balances remaining in the Democratic and Republican presidential campaigns are estimated at $219.7 million (about 293.6 billion KRW) and $151.3 million (about 202.2 billion KRW), respectively. The Trump campaign has lagged behind the Democrats in fundraising, and spending has increased due to former President Trump's legal costs. Trump's personal net worth, which was $10 billion (about 13.37 trillion KRW) in 2016, has also dropped to about $2.6 billion (about 3.47 trillion KRW) as of the end of the first quarter this year.